Alla K. Popovich, as wife and Guardian Ad Litem for Aleksandr M. Popovich, et al., Appellants,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2018).

STATE OF MINNESOTA
IN COURT OF APPEALS
A18-1987

Alla K. Popovich, as wife and Guardian Ad Litem for Aleksandr M. Popovich, et al.,
Appellants,

vs.

Allina Health System,
Respondent,

Emergency Physicians Professional Association, et al.,
Defendants.

Filed July 8, 2019
Affirmed
Stauber, Judge*
Dissenting, Ross, Judge

Hennepin County District Court
File No. 27-CV-18-10905

Brandon Thompson, Colin F. Peterson, Robins Kaplan LLP, Minneapolis, Minnesota (for
appellants)

Charles F. Webber, Nicholas J. Nelson, Elie C. Biel, Faegre Baker Daniels LLP,
Minneapolis, Minnesota (for respondent, Allina Health System)

Considered and decided by Connolly , Presiding Judge; Ross , Judge; and Stauber ,
Judge.

* Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.

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U N P U B L I S H E D O P I N I O N
STAUBER, Judge
In this interlocutory appeal fr om partial judgment , appellant Alla K. Popovich, as
wife and Guardian Ad Litem for Aleksandr M. Popovich, challenges the district court’ s
order partially granting dismissal of her vicarious-liability claim against respondent Allina
Health System (Allina). Because the district court did not err, we affirm.
FACTS
In February 2016, Aleksandr Popovich visited the emergency room at Unity
Hospital complaining of dizziness, loss of balance, blurred vision, headache, and shortness
of breath. Dr. Aileen Haung , an emergency-room physician, treated Mr. Popovich in the
emergency room and discharged him. Later that morning, Mr. Popovich was transported
to the Mercy Hospital emergency room. Dr. Taj Melson , another emergency -room
physician, evaluated Mr. Popovich and transferred him to Abbott Northwestern Hospital
for further care. Mr. Popovich remained hospitalized for more than two weeks and spent
a month in inpatient rehabilitation.
In June 2018, appellant Alla Popovich, Mr. Popovich’s wife, initiated a civil action
asserting that Mr. Popovich suffered severe and permanent damage requiring extensive
ongoing therapy and medical care for the rest of his life. The complaint alleges that the
emergency-room physicians were negligent, and that respondent Allina Health S ervices
was legally culpable for the physicians’ negligent acts and omissions through the doctrine
of apparent authority. Allina owns Unity Hospital and Mercy Hospital. However, it is

3
undisputed that the emergency-room physicians who treated Mr. Popovich are employees
of Emergency Physicians Professional Association, and are not employed by Allina.
In November 2018, the district court granted Allina’s motion to dismiss as a matter
of law on the ground that a hospital is not vicariously liable for the acts of non-employees.
The district court granted appellant’s request to enter final partial judgment under
Minnesota Rule of Civil Procedure 54.02, and this appeal follows.
D E C I S I O N
The district court may grant a motion to dismiss a complaint if i t “fail[s] to state a
claim upon which relief can be granted.” Minn. R. Civ. P. 12.02(e). On appeal, we review
a district court’s decision to dismiss a cause of action de novo. Cocchiarella v. Driggs ,
884 N.W.2d 621, 624 ( Minn. 2016). In this review, w e consider only the facts alleged in
the complaint, accept those facts as true, and construe all reasonable inferences in favor of
the nonmoving party. Bahr v. Capella Univ., 788 N.W.2d 76, 80 ( Minn. 2010). A claim
survives dismissal if it is “possible o n any evidence which might be produced, consistent
with the pleader’s theory, to grant the relief demanded.” Walsh v. U.S. Bank, N.A ., 851
N.W.2d 598, 603 (Minn. 2014).
Appellant argues that Allina is vicariously liable for the acts of the emergency-room
physicians under a principal-agent relationship. The doctrine of vicarious liability makes
“a principal . . . liable for the act of an agent committed in the course and within the scope
of the agency and not for a purpose personal to the agent.” Semrad v. Edina Realty, Inc.,
493 N.W.2d 528, 535 (Minn. 1992). An agent can bind a principal if the agent has actual
or apparent authority. Duluth Herald & News Tribune v. Plymouth Optical Co ., 176

4
N.W.2d 552, 555 ( Minn. 1970). Whether actual or apparent auth ority exists is a legal
question reviewed de novo. State v. Dotson , 900 N.W.2d 445, 450 (Minn. App. 2017).
Here, it is undisputed that the emergency-room physicians did not have actual authority to
act on Allina’s behalf. We therefore consider whether Allina is liable under the doctrine
of apparent authority. “Apparent authority is that authority which a pr incipal holds an
agent out as possessing, or knowingly permits an agent to assume.” Foley v. Allard, 427
N.W.2d 647, 652 (Minn. 1988).
Our decision in McElwain v. Van Beek is controlling. 447 N.W.2d 442 (Minn. App.
1989), review denied (Minn. Dec. 20, 1989).1 The McElwain court considered whether a
hospital could be held vicariously liable for the alleged negligence of an emergency -room
physician. Id. at 446 -47. We rejected appellant’s vicarious -liability claim and affirmed
summary judgment in favor of the hospital, stating:
In Minnesota, a hospital can only be held vicariously liable for
a physician’s acts if the physician is an employee of the
hospital. See Moeller v. Hauser , 237 Minn. 368, 378 -79, 54
N.W.2d 639, 645 -46 (1952). The evidence here sh ows that
[respondent doctor] was an independent contractor who has
staff privileges at many Twin City hospitals and is not an
employee of [respondent hospital]. Thus, the respondent
medical center is relieved of liability.
Id. at 446.

1The Minnesota Supreme Court not only denied review of McElwain; it subsequently
rejected the view that “recognition of this tort [negligent c redentialing of a physician by a
hospital] would effectively overrule McElwain . . . , where the court of appeals held that ‘a
hospital can only be held vicariously liable for a physician’s acts if the physician is an
employee of the hospital.’” Larson v. Wasemiller, 738 N.W.2d 300, 304 n. 2 (Minn. 2007).

5
Moeller, on which McElwain relies, concerned a five -year-old boy who had been
hospitalized with a fractured femur and put in traction in June, 1947. Moeller, 54 N.W.2d
at 641-43. The senior attending physician of the fracture service (the staff doctor), had
“assigned the care of the [boy] to himself as attending physician,” which meant that he
would retain the boy “in his care . . . until [the boy] was discharged.” Id. at 642. The boy
was seen by his staff doctor six or seven times between June 7 and June 30, but not between
July 1 and July 10. Id. at 642, 646. Staff doctors “[had] the final responsibility for the care
of patients.” Id. at 645.
The boy remained in traction until July 10, when he experienced pain due to “a
severe pressure sore, caused by localized and continued pressure which cut off circulation,
[that] had developed on the top of his foot.” Id. at 643. The staff doctor testified that the
sore had taken between 24 and 60 hours, or one to two-and-a-half days, to develop; another
doctor testified that it had taken several days. Id. at 647. Because of the sore, the boy
required three further operations , one in 1947 , and two in 1948; he was left with “a
permanent partial disability of somewhere between 30 and 40 percent.” Id. at 643.
An action wa s brought on the boy’s behalf against the staff doctor, against the
resident doctor who had provided routine care between July 1 and July 10, and against the
hospital, on the ground that it was liable for the resident doctor’s, but not the staff doctor’s,
acts. Id. at 641, 644. Staff doctors had their own established practices, maintained their
own offices, and were appointed to the hospital staff by the county welfare board; they
were not hired by the hospital. Id. at 642. Resident doctors were employed and paid by

6
the hospital, and staff doctors “supervise[d] the activities of the resident doctor[s] to some
extent.” Id. at 642, 645.
The staff doctor testified that, on June 30, he had “left word with the charge
nurse . . . that the traction [should] be removed, a splint applied, and the boy be sent home,”
that he did not recall the name of the charge nurse, that no intern or resident doctor had
accompanied him on June 30, and that he had not discussed the discharge with any other
doctor. Id. at 646. No nurse testified that they had received the discharge instruction. Id.
The head nurse testified that, if she had received a discharge order, it would have been
carried out, and if any other nurse had received the order, it would have been written in the
order book and then carried out. Id. at 647. There was no such order in the book. Id.
The supreme court noted that “the jury reasonably may have placed little credence
on [the staff doctor’s] explanation as to why h e failed to visit [the patient] after June 30,”
and concluded that “the jury could have found that . . . the [staff] doctor was under a duty
to see [the boy] sometime [after June 30 and] prior to July 10 and that the breach of this
duty was the proximate cause of the injury.” Id.
The resident doctor testified that “he saw the boy at least once and usually twice a
day between July 1 and July 10,” that he “did not see [the staff doctor] between July 1 and
July 10,” and that he “had no reason to call [the st aff doctor].” Id. at 643. The supreme
court noted that “[w]hether [the resident doctor] was actually as attentive as his testimony
indicated was a question for the jury,” and that “[its] finding of negligence against the
resident doctor is amply supported by the evidence in the record.” Id.

7
The supreme court also agreed with the district court that the hospital was liable for
the resident doctor’s negligence, rejecting the board’s argument that, because the resident
doctor was “under the authoritative control of the staff doctor,” the hospital was not liable
for his negligence. Id. at 644 “[We] hold that a resident doctor in a hospital who receives
his compensation from the hospital while providing medical care as a part of regular
hospital routine is a servant of the hospital so as to make the hospital liable for his
negligence.” Id. at 646.
Thus, the supreme court affirmed the district court’s decision that the hospital was
liable for the resident doctor’s contributory negligence because the resident doctor was a
hospital employee, and neither the district court nor the supreme court considered whether
the hospital was liable for the causal negligence of the staff doctor, who was not an
employee of the hospital. McElwain’s inference that Moeller supports the proposition that
hospitals are not liable for the negligence of doctors who are not their employees is
legitimate.
Applying McElwain here, we determine that Allina is not vicariously liable for the
acts of the emergency-room physicians as a matter of law. See 447 N.W.2d at 446 (holding
independent contractor-physician with staffing privileges at hospital is not an employee of
hospital). The record establishes that Drs. Haung and Melson were not Allina employees,
but were instead employed by th e Emergency Physicians Professional Association.
Because the uncontested evidence demonstrates that the physicians were not employed by
the hospitals or by Allina, Allina is “relieved of liability.” Id.

8
We are also persuaded by relevant unpublished cas elaw and federal caselaw. In
Kramer v. St. Cloud Hosp ., 2012 WL 360415, at *9 (Minn. App. Feb. 6, 2012), review
denied (Minn. Apr. 25, 2012), we upheld dismissal of a medical-malpractice claim in favor
of a hospital, noting that “Minnesota does not recogn ize a medical -malpractice claim
against a hospital based on the doctrine of apparent authority.” See also Dynamic Air, Inc.
v. Bloch , 502 N.W.2d 796, 800 (Minn. App. 1993) (holding that, while not binding,
unpublished opinions may be persuasive). Courts applying Minnesota law have likewise
held that a hospital is not vicariously liable for the actions of its independent contractors.
See Damgaard v. Avera Health , 108 F. Supp. 3d 689, 696 (D. Minn. 2015) (citing
McElwain, 447 N.W.2d at 446, as a supporting example after observing that, “As
[d]efendants [providers of healthcare] correctly note, and [plaintiff, a patient] appears to
concede, in Minnesota a healthcare provider can be vicariously liable for a physician’s
negligence only if the physician is an e mployee of the provider.” ); s ee also TCI Bus.
Capital, Inc. v. Five Star Am. Die Casting, LLC, 890 N.W.2d 423, 431 (Minn. App. 2017)
(“A federal court’s interpretation of Minnesota law is not binding on this court, though it
may have persuasive value.”).
Appellant urges this court to overturn McElwain. We decline to do so. As an error-
correcting court, we are bound by our published decisions. See State v. M.L.A., 785 N.W.2d
763, 767 (Minn. App. 2010) (“The district court, like this court, is bound by supreme court
precedent”), review denied (Minn. Sept. 21, 2010).
The doctrine of stare decisis . . . directs that we adhere to
former decisions in order that there might be stability in the
law. . . . We will only overrule our precedent if provided with

9
a compelling reason to do so. The reasons for departing from
former decisions must greatly outweigh reasons for adhering
to them.

Ariola v. City of Stillwater , 889 N.W.2d 340, 356 (Minn. App. 2017) (quotations and
citation omitted), review denied (Minn. Apr. 18, 2017).
Ariola concerned whether active knowledge or constructive knowledge was
required for the adult -trespasser exception to recreational -use immunity. This court had
released six published decisions stating that actual knowledge was required in 2009, 2008,
1998, 1989, 1988, and 1987, and one published decision stating that only constructive
knowledge was required in 1991. Id. at 355. We concluded that three reasons supported
overruling the 1991 decision. Id. at 356.
First, the six published decisions that conflicted with the 1991 decision, particularly
the three that followed it and therefore could have distinguished it, but did not, supported
overruling. Id. Here, no case from either this court or the supreme court supports
overruling McElwain. Second, the 1991 decision, conflicting as it did with six others,
created “confusion for district courts, counsel, and parties ” and caused unnecessary
litigation. Id. Again, no published decision case conflicts with McElwain. Finally, the
1991 decision conflicted with the Restatement (Second) of Torts, which was consistent
with the other six decisions. Id. No such conflict with a secondary source exists here.
Appellant has not shown any compelling reason to overrule McElwain.
The McElwain decision has stood as the law in Minnesota for thirty years. The
Minnesota Supreme Court had the opportunity to review the case further on appeal, and
declined to do so. Moreover, as an error -correcting court, this court is “without authority

10
to change the law.” Lake George Park, L.L.C. v. IBM Mid-Am. Emps. Fed. Credit Union,
576 N.W.2d 463, 466 (Minn. App. 1998), review denied (Minn. June 17, 1998). “[T]he
task of extending existing law falls to the supreme court or the legislature, but it does not
fall to this court.” Tereault v. Palmer, 413 N.W.2d 283, 286 (Minn. App. 1987), review
denied (Minn. Dec. 18, 1987).
In sum, l imiting our consideration to the facts alleged in the complaint, accepting
those facts as true, and construing all reasonable inferences in favor of appellant, Bahr, 788
N.W.2d at 80, we determine that appellant’s cause of action against Allina fails to state a
claim upon which relief can be granted as a matter of law. Because appellant’s vicarious-
liability claims against the hospital are foreclosed by our decision in McElwain, we affirm
the district court’s order granting partial dismissal in Allina’s favor.
Affirmed.

D-1
ROSS, Judge (dissenting)
I respectfully dissent from the majority’s holding that hospitals in Minnesota are
categorically immune from vicarious liability in negligence suits that rest on the
apparent-authority doctrine. I agree that the district court was bound to grant the hospital’s
motion to dismiss because we said in McElwain v. Van Beek that, “[i]n Minnesota, a
hospital can only be held vicariously liable for a physician’s acts if the physician is an
employee of the hospital.” 447 N.W.2d 442, 446 (Minn. App. 1989), review denied (Minn.
Dec. 20, 1989), partly overruled by Warren v. Dinter, 926 N.W.2d 370 (Minn. 2019). And
I agree with the majority that we must affirm if we follow that declaration in McElwain.
But a two-tier problem prevents me from joining the majority’s reliance on McElwain.
First, McElwain did not purport to establish a new rule of law limiting vicarious
liability but merely to restate what it thought was an old rule of law already established or
declared in Moeller v. Hauser , 54 N.W.2d 639, 645 -46 (1952). Second, McElwain’s
understanding that it was merely restating an old rule of law already established or declared
in Moeller is, in a word, wrong. This is not open to serious debate. Moeller never actually
established nor declared the rule of law that McElwain says it did, and no reading of
Moeller supports the idea that its conclusion was premised implicitly on the supposed rule
of law. In other words, when we implied in McElwain that a rule of law exists in Minnesota
categorically immunizing hospitals from vicarious liability in every malpractice case in
which the allegedly negligent physician has any other arrangement than an employment
relationship with the hospital, we were plainly incorrect.

D-2
I need not labor to make the point that Moeller does not stand for the proposition
McElwain ascribed to it; not even the respondent hospital, well represented by
highly-skilled appellate counsel, attempt s to defend McElwain’s reliance on Moeller for
the stated rule. It is enough to point out the two clearest reasons that Moeller certainly does
not hold that “a hospital can only be held vicariously liable for a physician’s acts i f the
physician is an employee of the hospital.” First, again, nothing stated in Moeller comes
remotely close to expressing that holding. And second, beyond the fact Moeller did not so
hold, it could not so hold. A holding of a case is only that rule of law the court necessarily
relied on to decide the actual issues then being decided. Cf. Wandersee v. Brellenthin
Chevrolet Co., 102 N.W.2d 514, 520 (1960) (“Statements and comments in an opinion
concerning some rule of law or legal proposition not necessarily involved nor essential to
determination of the case in hand . . . lack the force of an adjudication.”) (quotation
omitted). Moeller was answering whether, under the employer-liability doctrine of
respondeat superior , a hospital could avoid liability for a hospital -employed resident
physician’s allegedly negligent care on the theory that the resident was really serving the
hospital’s staff physician rather than the hospital. 54 N.W.2d at 644. And its answer to that
question has nothing to do with nonemployer vicarious liability: “[W]e must hold that a
resident doctor in a hospital who receives his compensation from the hospital while
providing medical care as a part of regular hospital routine is a servant of the hospital so
as to make the hospital liable for his negligence under the doctrine of respondeat superior.”
Id. at 646. Moeller does not hold what McElwain declares.

D-3
I adhere strongly to the oft -stated concept that precedent ought to be followed for
the sake of stability of the rule of law. See Oanes v. Allstate Ins. Co., 617 N.W.2d 401, 406
(Minn. 2000) (“The doctrine of stare decisis directs that we adhere to former decisions in
order that there might be stability in the law .”). But that is because the rule of law is
purposefully built, presumably, on an existing rule of law that itself deliberately extended
a rule of law that grew thoughtfully from yet another rule of law, and so on. As the supreme
court explained stare decisis long ago, “It is elementary that, when a rule has bee n
deliberately adopted and declared, it ought not to be disturbed by the same court, except
for very cogent reasons, and upon a clear manifestation of error.” State v. Manford , 106
N.W. 907, 907 (Minn. 1906) (emphasis added). The heart of the doctrine of stare decisis,
then, is that a court should not easily forsake a rule that it deliberately made, even if the
court should later question the underlying reasoning. But t he rule in McElwain was not
deliberately made, so we can address it without second-guessing our prior rationale. And I
think the rule in McElwain carries even less weight than a rule of law that is merely
announced without deliberation, detached from history, and undeveloped through
reasoning; in addition to having all those deficiencies, it is also a rule of law premised
entirely on what we now see is a simple fallacy, which is the notion that the rule already
existed.
The majority succumbs to the temptation to give the McElwain declaration
significance because the supreme court denied a petition to review our decision. This is a
mistake because “[t]he temptation to read significance into a denial of a petition for
further review is best resisted.” Murphy v. Milbank Mut. Ins. Co. , 388 N.W.2d 732, 739

D-4
(Minn. 1986). We should instead recognize that the supreme court’s choice not to review
one of our decisions “does not give the [decision] any more or less precedential weight
than a court of appeals decision from which no review was sought.” Id.
I add that we have previously done precisely what the majority suggests we cannot
do here. In a situation remarkably similar to this one, for example, we overturned a prior
published opinion of this court that (1) had declared a rule of law that was not supported
by the supreme court case cited as support , (2) had been denied revie w by the supreme
court, and (3) had lasted as supposed precedent for nearly 20 years. This court had made
the categorical declaration in Imdieke v. Imdieke , “To base custody or care on a parent’s
remaining in a certain area is a restrictive condition contrary to Minnesota law.”
411 N.W.2d 241, 244 (Minn. App. 1987), review denied (Minn. Oct. 30, 1987). We offered
no explanation for the declaration other than to cite the supreme court decision of Auge v.
Auge, 334 N.W.2d 393 (Minn. 1983). Our declaration in Imdieke ostensibly remained the
law of the land for nearly two decades, and we relied on it in unpublished opinions. See,
e.g., Lundquist v. Lundquist , C0-94-509, 1994 WL 510168, at *2 (M inn. App. Sept. 20,
1994) (citing Imdieke after observing, “We have previously held that residential restrictions
on custodial parents are impermissible limitations.”). But we corrected the Imdieke
declaration of supposed law in 2006 when we finally noticed that “Auge did not involve an
issue of conditional custody, and there is no statement in the Auge opinion that custody
conditioned on maintaining a particular residence for a child is contrary to Minnesota law.”
Dailey v. Chermak, 709 N.W.2d 626, 630 (Mi nn. App. 2006) (“Thus, the pronouncement

D-5
in Imdieke regarding conditional custody was dictum and without basis in the law.”) ,
review denied (Minn. May 16, 2006).
The appellants have illuminated a path for a holding that the McElwain declaration
was really just dictum that we can disregard since the opinion alternatively concluded that
the accused tortfeasor had engaged in no negligent act, rendering unnecessary our stray
statement about a hospital’s vicarious liability. See McElwain, 447 N.W.2d at 445 -46
(holding that the physician did not owe a duty of care to the injured non -patient). I would
rather deal with the error directly, however, as we treat other errors, and correct it on the
ground that, like the Imdieke declaration, the McElwain declaration was “without basis in
the law.” People are fallible, and judges are people, making courts fallible. Sometimes,
despite diligent efforts, courts err. We did. We should say so.
Recognizing that Moeller never established the rule of law t hat McElwain said it
established and that McElwain does not offer any rationale or explanation for the rule,
I think it is accurate to say that Minnesota has never properly established any rule
categorically immunizing hospitals from vicarious liability pr emised on the tortfeasor’s
apparent authority to act for the institution. The respondent hospital points to Kansas and
Missouri as states that have enacted statutes to restrict hospital liability in a manner similar
to the McElwain rule and to other states that have taken various approaches to limit hospital
vicarious liability. Those other approaches might be relevant to us were we the body
responsible for making unprecedented changes in the law. We are not.
The majority offers only circular support for the McElwain declaration. It deems
“persuasive” the reasoning of an unpublished opinion of this court and also a federal district

D-6
court decision. But, neither of those cases offers any rationale why Minnesota supposedly
excepts hospitals from the same standard of apparent authority that applies to every other
institution. I nstead, both cases followed the McElwain rule simply because McElwain
announced the rule. See Damgaard v. Avera Health , 108 F. Supp. 3d 689, 696 (D. Minn.
2015) (citing McElwain for proposition that “a healthcare provider can be vicariously liable
for a physician’s negligence only if the physician is an employee of the provider”); Kramer
v. St. Cloud Hosp. , No. A11 -1187, 2012 WL 360415, at *9 (Minn. App. Feb. 6, 2012)
(citing on McElwain for the same proposition). Citing the two cases that merely cited
McElwain adds nothing to the strength of McElwain or to the majority’s reliance on it.
The district court did not err by dutifully following the rule of law as we declared it
in McElwain, but it is clear that we erred in declaring the rule. I would decline to follow
the untethered and unexplained McElwain declaration based on its mistaken, misplaced
reliance on the cited authority and expressly overrule the declaration as nonbinding. I
would therefore r everse and, without otherwise commenting on the merit of the
apparent-authority theory of liability applied to this case, instruct the district court to revisit
the hospital’s dispositive motion in light of our overruling of McElwain.